Source: Economics Group of Wells Fargo Bank, N.A.
Summary
While the headline GDP print of 3.0% exceeded expectations, underlying growth in the economy as measured by private domestic final purchases slowed for the third consecutive quarter to come in at just a 1.2% pace. The largest boost on record from trade offset a drag from inventories.
Trade: From Zero to Hero…for Now
The U.S. economy grew at a 3.0% annualized clip in the first quarter, much faster than the 2.6% that had been expected by the Bloomberg Consensus. But just as the Q1 contraction in GDP understated the health of the economy, today’s barn-burner of a headline overstates it.